A federal proposal that would redraw the definition of a small business has Fort Worth officials and local companies worried that bigger firms could soon be competing for contracts meant for smaller operations. The plan, submitted by the U.S. Small Business Administration in August 2026, would replace almost 1,000 industry size categories with just 338 broader ones and raise the revenue and employee thresholds that determine who qualifies as small.
The changes would touch some of Fort Worth’s biggest economic sectors, including defense, construction, manufacturing and IT, according to Fort Worth Report. Fort Worth City Council members got a briefing on the proposal during an Oct. 27 work session, as city and chamber officials began sounding the alarm over what the rewrite could mean for local contractors.
What the New Thresholds Would Actually Change
Under the SBA’s plan, the number of businesses eligible for federal contracts, subsidized financing and regulatory protections would grow from 6.3 million to an estimated 6.5 million nationwide. SBA documents cited in the same report estimate that 110,000 to 114,541 mid-sized and larger firms would newly qualify as small businesses under the revised standards.
In some fields, the jump is dramatic. Revenue and employee limits in sectors like technology and management consulting would rise by more than 200% to as much as 1,400%, the Fort Worth Report’s reporting shows. The proposed methodology leans on three factors — national industry size, the number of geographical markets and average market size — along with an updated size-standard formula and an inflation-based monetary adjustment.
Conflicting Numbers on How Many Firms Would Qualify
Not everyone agrees on the scale of the shift. While the Fort Worth Report cites SBA estimates of 110,000 to 114,541 newly qualifying firms, Washington Technology reported a separate estimate putting the increase at just 4,000 to 6,000 small businesses. Federal News Network reported that SBA’s Office of Advocacy pegged that smaller figure specifically to current small federal contractors — a pool of about 56,000 firms — rather than to the broader universe of all businesses, suggesting the two numbers may be measuring different things entirely.
For Fort Worth companies, the worry isn’t just abstract math. The proposed changes could make around 200 companies ineligible for set-aside contracts, potentially cutting into their profits, per the Fort Worth Report’s reporting.
Local Leaders Push Back
U.S. Rep. Marc Veasey has been vocal about his concerns. Speaking at a manufacturing day event in White Settlement last month, Veasey said he disagreed with the administration’s sizing decisions even as he voiced support for small and midsize businesses generally. Steve Montgomery, president and CEO of the Fort Worth Chamber, said, “A local company with 25, 50 or 100 employees should not have to compete” against firms with thousands of workers, according to the Fort Worth Report.
Veasey argued the proposed thresholds would force the smallest businesses to go head-to-head with companies carrying far larger employee bases, pointing to a White Settlement business with just seven workers as an example of the mismatch against better-resourced competitors.
Steve Montgomery, president and CEO of the Fort Worth Chamber, echoed that concern. “This risks undermining the fundamental purpose of the SBA,” Montgomery said, adding that a broader definition could dilute opportunities and resources meant for genuinely small businesses.
Fort Worth Could Set Its Own Rules
District 6 City Council member Mia Hall has led discussions about Fort Worth’s response to the federal proposal and said she wants to protect the city’s existing small-business definitions and eligibility criteria. Hall noted that Fort Worth could set its own size standards for local government contracts, giving the city a potential workaround if the federal thresholds shift.
A Fort Worth Chamber survey found that local small businesses opposed the new definitions by an 8-to-1 ratio, with only 4% supporting the proposal as written. Survey respondents identified increased competition for set-aside contracts as their biggest concern, and seven respondents specifically worried about subcontracting risks if prime contractors suddenly get reclassified as small.
National Feedback Also Runs Negative
Fort Worth’s unease mirrors a broader national pattern. More than 200 people signed up to give one-minute comments during a two-hour virtual SBA town hall on the draft rules, according to Federal News Network. The Office of Information and Regulatory Affairs had received 67,220 comments on the proposed rule as of Sept. 20, and the station’s report notes that an analysis of more than 65,000 of those comments found an eight-to-one ratio opposing the changes versus supporting them.
A separate GovCon Intelligence analysis found that over 85% of comments opposed SBA’s proposed increases outright or opposed the scale of the increases while favoring some kind of update, per the same outlet. Not every account paints opposition as overwhelming, though — Washington Technology reported that while most comments opposed the changes, the opposition did not appear to represent a dominant majority. Some commenters told that outlet they supported raising the size standards, arguing it would give successful small businesses more room to grow and better prepare for the unrestricted marketplace before losing their small-business status.
Comment Window Still Open
Businesses and other stakeholders have until Nov. 20 to weigh in, after the SBA Office of Advocacy extended the deadline for both the industry size standards proposal and a related revised size-standards methodology, per the agency’s own announcement. The SBA has said the overhaul would make the classification system easier to navigate and reduce the sudden loss of federal preferences when firms cross size thresholds.
Similar anxieties are surfacing well beyond Tarrant County. An opinion piece in the Akron Beacon Journal argued the proposed standards could hurt small businesses in that Ohio region, with local chamber leaders there also voicing opposition. For now, the rule remains a proposal, and Fort Worth’s business community is watching closely to see how far the final version diverges from what’s on the table today.
